Burmese rebels block Asia's 'Suez Canal'

BURMESE rebels are blocking construction vehicles using a road linking Thailand to a proposed $US60 billion ($A61.7 billion) development project at a sleepy Burmese seaport that its backers say will reshape Asia's trade routes.

Rebels of the Karen National Union say the building of a massive transport and manufacturing hub at Tavoy, also called Dawei, on Burma's east coast, will destroy the environment and cause people to suffer.

Zipporah Sein, the Karen union's general secretary, called on the Italian-Thai Development company to carry out an environmental impact assessment before continuing with the $US8 billion first-stage building of a deep-sea port and other facilities.

''The people must have the right to decide. They need to know about the impact of the project,'' Ms Sein said.

Documents show the company plans a deep-sea port in a 250-square-kilometre special economic zone that would create a short cut for trade between Europe and Indochina.

Traders would save fuel and time by avoiding the journey of several thousand kilometres through the Strait of Malacca.

A little-known agreement signed late last year between Burma's military-dominated rulers and Italian-Thai Development, one of Thailand's largest civil construction companies, approves a deep-sea port with shipbuilding and maintenance facilities, a petrochemical industrial estate with oil refining and gas separation plant and other medium and light industries such as car and garment factories.

Plans also include five-star resorts on pristine islands in the area. Italian-Thai Development documents obtained by The Age show plans for an eight-lane highway and railway linking Tavoy to Thailand, forming part of a southern economic corridor in the Greater Mekong Sub-region, which would run from Ho Chi Minh City in Vietnam to Burma.

A north-south railway and pipeline running from Kunming in China's Yunnan province through the Burmese towns of Mandalay and Pegu to Tavoy is also planned.

Thant Myint-U, a US-educated Burmese academic and former UN official who has published a book titled Where China Meets India, compares the development of a new trade route through Burma with the opening of the Suez Canal joining Europe to the Indian Ocean.

He says China has long wanted an alternative route to the Strait of Malacca, which it sees as a natural choke point where future enemies could cut off foreign energy supplies.

Work began months ago to upgrade a road linking the Tavoy site to Kanchanaburi in western Thailand.

Karen rebels, who have waged war against the Burmese central government since 1949, inhabit the hills around Tavoy and control areas along the road to Thailand.

The rebels say they will allow vehicles carrying humanitarian aid to use the road but not vehicles belonging to Italian-Thai Development.